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Turnkey Family Foundation Program
Family Foundation Format Descriptions
Structured to Suit Your Needs
A family foundation account may be established in any of the following forms
or structures:
The experienced staff at The American Foundation™ can work with your tax and financial advisors to
help you determine which type of family foundation is best for you.
Format
Descriptions
Component
Family Foundation
(A component charitable foundation account at the American Foundation)
This is highly preferred for all foundations regardless of size. A family
foundation is a charitable account created to provide ongoing financial
support to donor recommended charities. Assets donated to a family foundation
account are managed for growth and income, and a portion of the annual income or growth
is distributed to family selected charities. This is the simplest and easiest
family foundation format to operate. Cash or assets are transferred directly
to the American Foundation™ for the
particular family foundation account of the donor establishing the fund. This
foundation is established with a minimum deposit of $5,000.
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solid foundation will
flourish in posterity.
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The American Foundation is a qualified
501(c)(3) public charity. All of its family foundation component accounts
qualify for the same public charity tax status. Donors qualify for the
highest tax deductions - up to 50% of AGI for contributions of cash and 30%
of AGI for donations of appreciated properties. Excess deductions can be
carried forward for five years. The assets are managed for income and
growth. The donor or the donor's designee makes recommendations for grants of
all or part of the annual income and growth to qualified public charities.
Unless specifically noted otherwise,
all donations accompanying an application will establish this preferred and
standard component family foundation account with the American Foundation™.
Support
Organization
A support organization is a foundation formed to support a particular charity
or cause. A support organization is an entirely separate entity with its own
501(c)(3) tax status.
The American Foundation™ has pioneered the use of support organizations as
family foundations. A family foundation in this format, affiliated with the
American Foundation™, can provide
special benefits.
This type of foundation is a public
charity, so donors receive the highest tax deductions - up to 50% of AGI for
contributions of cash, and 30% of AGI for donations of appreciated property.
Excess deductions can be carried forward for five years. The support
organization format is well suited for very large foundations where the donor
wants continued hands-on administrative involvement. It can be set up as a
trust or a corporation, depending on its size and nature. The American
Foundation will help you determine which format is best for your situation.
The donor or selected family members can
be appointed as trustees or board members. Special
procedures are implemented in the governing documents and by-laws to ensure
continued adherence to the donor's charitable mission and objectives. This
type of foundation may raise money as an independent entity, apply for
grants, and have its own offices, officers, employees, and programs.
| Private
Foundations
By in
large, this approach has fallen out of favor with most tax
and foundation planners because of the reduced tax benefits
and burdensome regulations. However, The American
Foundation™ can "adopt," convert, and/or administer existing
private foundations, bringing them into its extended Family
of Foundations' operations. And, there are some
circumstances that warrant the creation of private
foundations that work in tandem, or in concert, with our
family foundations at The American Foundation™.
This foundation type is
a totally separate and distinct entity. In addition to
having increased responsibilities and liabilities, there are
many tax and administrative disadvantages. There are also
other restrictions and limitations that prevent the donor
from achieving many tax and financial objectives that can
otherwise be achieved with a family foundation under our
public charity format. Deductions for gifts of cash are
limited to 30% of Adjusted Gross Income, 20% for donations
of appreciated property.
The American Foundation™
is well suited to assist you in the administration of a
private foundation. A private foundation can be best
utilized in conjunction with one of our public charity
foundation formats. The synergistic benefit of being part of
The American Family of Foundations is much better than
acting alone. |
 
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